Myanmar's Suu Kyi assures China of solution to stalled dam

By Ben Blanchard

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By Ben Blanchard

BEIJING (Reuters) - Myanmar leader Aung San Suu Kyi told China's premier on Thursday that her new government is willing to look for a resolution that suits both countries to a suspended Chinese-funded hydropower project in northern Myanmar, a senior Chinese diplomat said.

Finding a solution to the $3.6 billion Myitsone dam project is important for Suu Kyi who needs China's cooperation in talks with Myanmar's ethnic minority armed groups operating along northern borders with China.

Former Myanmar President Thein Sein angered China in 2011 when he suspended work on the hydropower dam, in the Ayeyarwady river basin, after it drew widespread environmental protests.

About 90 percent of the dam's power would have gone to China. At the time, Suu Kyi also called for the project's suspension.

Chinese Vice Foreign Minister Liu Zhenmin told reporters after a meeting in Beijing between Suu Kyi and Chinese Premier Li Keqiang that Li had said China hopes Myanmar can come up with an appropriate resolution.

"Aung San Suu Kyi said that the Myanmar government has already set up an investigation committee to look for an appropriate resolution to the Myitsone dam issue," Liu said.

"She also said that she is willing to look for a resolution that suits both sides' interests via both sides' energy administrations' cooperation."

China has been pushing for work to restart on the dam, which under the original plans would have sent 90 percent of its power to China.

A Myanmar government commission reviewing the project - as well as other proposed hydropower dams, including several on the Thanlwin river - is expected to report by Nov. 11.

Suu Kyi did not mention the dam in remarks to Li made in front of journalists, but said she hoped her visit would "further consolidate and develop" relations.

The two countries also signed a deal to build a strategic bridge near their border.

A Myanmar foreign ministry official said China had also agreed to build two hospitals in Myanmar's two largest cities, Yangon and Mandalay.

The bridge will be built in Kunlong, 32 km (20 miles) from the border in northeastern Myanmar and near the Kokang region where an ethnic Chinese rebel group fought Myanmar's military last year.

Liu said Premier Li reaffirmed China's support for efforts to bring peace to northern Myanmar.

Suu Kyi, who is barred from the presidency by a junta-drafted constitution but holds several government posts including that of foreign minister, will meet Chinese President Xi Jinping on Friday.

The visit is Suu Kyi's first major diplomatic foray as de facto leader, after a new government took power in April following her National League for Democracy's sweeping election victory in November.

(Additional reporting by Aung Hla Tun in YANGON; Editing by Robert Birsel and Nick Macfie)